By John Lawrence
We need to shape the built environment to enable and facilitate innovative, new-economy growth.
Considerable employee-to-firm and firm-to-firm mismatches exist in the Memphis Metro area, while the new knowledge economy prizes accessibility and proximity. Economic drivers and regional assets are migrating outward faster than they are growing. This pattern is unsustainable without significant growth in the overall regional economy.
Where Do I Invest?
This entire region is designed to move products, not people or ideas. Infrastructure is focused on distribution of goods, not connectivity of workers. The region lacks density and well-connected nodes of activity. The jobs-housing mismatch hinders access to employment. Infrastructure maintenance and taxing structures are being strained by geographic expansion outpacing economic growth. And, the unpredictable spatial distribution and geographic growth patterns lessen the desirability of the area as an investment location.
Employment, while largely in Shelby County, is highly decentralized. Approximately 7% of employees are concentrated near the airport, 6% in the Southeast Memphis warehouse area, 4% in the Central Business District, 4% in the Downtown Medical Center and 3% in the East Memphis Medical District. Almost 2% of employees are concentrated around Tunica County gaming facilities. Over 74% of employees are dispersed throughout the area with few definable concentrations.
Regional growth patterns are complicating movement of people. Due to outmigration and annexation, the City of Memphis density has declined significantly from 7,780 people per square mile in 1950 to 1,915 today. And two-thirds of recent regional job growth has occurred in suburban counties.
Private job-creation investments that are occurring in the region are being driven largely by slight tax advantages in North Mississippi in addition to aggressive incentive packages offered in both Tennessee and Mississippi.
How Do I Get To Work?
Most people drive to work and work to drive. The region’s very low traffic congestion compared to other metros allows residents to travel farther in personal vehicles without additional loss of time. However, there is a cost associated with this for commuters.
The Memphis MSA ranks 51 out of 100 metros for housing affordability with 35.9% of the population spending more than 30% of household income on housing according to the American Community Survey. At $14,182, Memphis regional transportation costs are the 10th highest of all MSAs with a population more than 1 million people. When transportation costs are added, H+T Housing Plus Transportation Index finds that 88.5% of the regional population spends over 45% of their income on housing and transportation.
With low coverage, frequency and access to jobs, transit is not a reasonable alternative. The Memphis area ranks 68th in coverage and 64th in service frequency among the 100 largest metros. Region-wide, 5% of jobs are accessible by transit within 45 minutes, 10% within 60 minutes and 26% within 90 minutes. Access to low-skill jobs by transit ranks 73rd among the 100 largest metros.
Economic Development Depends on Next Generation Land-Use
Basic growth may depend on how predictable investment opportunities are and how connected people are to jobs. To compete long term in the new-economy, this region needs to link land-use decisions to market demand. Mixing complementary uses should be encouraged. Density must increase. And, job concentrations need to be purposefully linked to employment candidates.
We could adopt (or invent) 21st century land-use planning models. We could establish innovation districts. We could design strategic redevelopment projects at key locations and prioritize future target industry sites.
But we must first accept that competitive metropolitan regions succeed when their economic assets are concentrated, their geographic make-up reduces transaction costs and their organization encourages innovation-producing interactions.
Part Eight: Tracking the Market to Understand Emerging Opportunities – Monday (10/14/13)
Part Nine: Prioritizing First-Step Initiatives – Wednesday — (10/16/13)